Judge orders Quinn administration to honor contract raises

SPRINGFIELD – Gov. Pat Quinn’s administration must pay $60 million in wage increases promised last year to state workers – eventually – a Cook County judge has ruled.

Circuit Judge Richard Billik Jr. decreed in an order made public Friday that regardless of whether the state budget has enough money, Quinn can’t renege on contractual pay hikes negotiated with the American Federation of State, County and Municipal Employees.

The state must pay what it can now, and cough up the rest of it when funds become available – at 7 percent interest, Billik said.

A spokesman said a Quinn administration appeal is likely. It would continue a tussle between the Democratic governor and the state’s most powerful labor force. It has spilled over into contentious contract talks, bitter feelings over Quinn’s plans to close state facilities to save money and a massive lobbying effort against his desire to cut costs associated with retirement benefits.

Quinn refused to pay about 40,000 AFSCME employees raises beginning in July 2011 under a contract negotiated by his predecessor. He argued the Legislature hadn’t appropriated money to pay the increases, worth about $75 million. As money became available last year, he released it, so some state agency workers received their raises.

About 30,000 employees continue to take home lighter-than-expected paychecks.

“As the governor has said repeatedly, the state cannot pay money it does not have the appropriation authority to spend,” Quinn budget spokesman Abdon Pallasch said. He said Quinn’s staff would consider an appeal after seeing Billik’s written order.

Billik ordered the administration in August to hold back $42 million in money not yet earmarked for other bills in case he ultimately sided with the union. Of that, $18 million was from general revenue originally destined for personnel salaries.

Officials could not say Friday how much of that the state might have to turn over now if Billik’s ruling stands.

In a statement, AFSCME tempered its satisfaction by acknowledging the ruling was not an “unconditional victory.”

That’s because Billik affirmed his decision last July that Quinn isn’t required to pay money that hadn’t been appropriated. Billik asked an arbitrator, whose earlier nonbinding decision favored the union, to revisit the case with an eye toward the state’s ability to pay. But the arbitrator refused, putting the issue back in the judge’s lap.

Billik’s verbal order issued Friday included a kind of IOU: Pay what’s available now, and reimburse the rest when it’s available, plus 7 percent interest.

It has been an unlikely battle between a governor and organized labor usually friendly to Democrats. State elections records show Quinn, who’s announced he’ll seek re-election in 2014, received $575,000 in campaign contributions from AFSCME – including $350,000 from the national organization – in the final weeks of the 2010 race.

In the four-year contract that expired June 30, AFSCME members were due a 4 percent increase in July 2011. But earlier, the union agreed to delay 2 percent of that until January of this year because of the state’s budget problems. The contract called for another 1.25 percent increase Jan. 1, but Quinn has withheld the entire 5.25 percent.

Negotiations over a new contract have stalled, so the pact’s terms remain in effect even though the administration took the mostly symbolic step of canceling it late last month. Officials argued that the union had not budged on its position while the state had moved from demanding wage cuts to a wage freeze.

AFSCME spokesman Anders Lindall said Friday the union has offered to freeze wages for the first year of a proposed three-year deal, but continues to oppose “unaffordable” cost proposals by the administration related to health insurance.